KaloBios binds up Martin Shkreli and cages his stock in a long goodbye
The new CEO at KaloBios has already made it clear that he doesn’t want to see Martin Shkreli playing new games with the company’s stock. Now, just to make sure that can never happen, he’s provided some legal rope and duct tape to keep the indicted biotech exec and one-time hedge fund prankster safely under wraps and out of sight.
CEO Cameron Durrant, who’s brought the company out of bankruptcy and is now trying to blaze a new path forward, struck a deal that restricts Shkreli’s handling of the stock he has left in KaloBios. This new pact restricts his right to sell stock, offers KaloBios a first right of refusal for any sale of the stock, and prohibits Shkreli for transferring the stock to any of his associates.
He’s also prohibited from buying more stock or seeking to control the company’s board. And the new CEO is setting aside 300,000 shares to settle a class action suit brought against the company for Shkreli’s brief but tumultuous reign.
In earlier interviews with me, Durrant has repeatedly stressed that he may take elements of Shkreli’s game plan but there was no going back onto a major exchange or winning investors’ trust as long as there was a hint of Shkreli’s continued involvement.
KaloBios got started as an antibody company that quickly went awry, experiencing serious setbacks in the clinic that took the company to the edge of bankruptcy. At that point, Shkreli – at the height of his notoriety for jacking up the price of Daraprim and taking to Twitter to defiantly ridicule anyone who questioned his move – stepped in grabbed control. It all came tumbling down in weeks, though, after the feds indicted him on a growing list of charges.
After some months of struggle, Durrant brought the company out of bankruptcy July 1, with $14 million in financing and a license to develop a drug for Chagas disease and plans to put one of the antibodies back into the clinic.